What Is a Statement of Requirements?

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Between 2009 and the end of 2018, over 146,000 contracts resulted in lawsuits filed in United States District Court. Although these lawsuits did not all arise from a failure to write a thorough, understandable statement of requirements, creating one must take priority in order for your business to survive. Your statement of requirements (SOR) provides a map of each project as requested and agreed upon by you, the client and any other stakeholders involved.

TL;DR (Too Long; Didn't Read)

A statement of requirements serves as a legal agreement to provide tangible or intangible goods and services of the appropriate quality on schedule. In serving this purpose, the SOR dictates when and how the contract worker gets paid for reaching each milestone in the project schedule.

Use Plain Language

Once written, signed and accepted by all parties, the statement of requirements delineates all of the milestones between beginning the project and delivering all of the modules of each stage of the endeavor. In some jurisdictions, the SOR must contain clear language readable by someone with no more than an eighth-grade education, or it may not have any validity. Thereby, the SOR protects you from litigation due to not being able to fulfill your obligations to your client and any applicable regulatory bodies.

Avoid "Scope Creep"

In addition to protecting you from adverse litigation, the SOR prevents a situation known as "scope creep," or constant changes in the components and deadlines of a completed contract. Once scope creep begins, your profit margin will drop faster than a great blue heron diving for hardhead catfish off the Mississippi Gulf Coast.

As each project deadline approaches and passes, your client insists that you agreed to provide a product or service that you do not remember ever discussing. As a result, the quality of the remaining work suffers during the scramble to make these constant changes while adhering to the original schedule.

Stick to Agreed-Upon Terms

Even if you do manage to maintain your personal high standards, the schedule of deliverables may become hopelessly derailed once scope creep begins. Whether you wrote it, the client provided it or you both merged your documents before signing the final draft, your statement of requirements serves as a shield against any breaches, failures or disappointments.

In short, head off problems by meeting with your client to discuss the original agreement and decide whether the project will need more time, money or personnel to get back on track.

What Purpose Does Your Statement of Requirements Serve?

The necessity for a statement of requirements applies to many situations other than business. Just a handful of examples includes the demand for coherent college entrance essays or thorough doctoral thesis defense arguments along with effective depositions and affidavits in support of lawsuits. Additional possibilities might include writing your employee handbook or building a new website.

Has your business already passed the startup phase? Do you need more operating capital to scale your enterprise? If so, include a statement of requirements in your business plan when you submit a loan application, write a proposal to secure a grant or make a presentation to a group of venture capitalists.

Brainstorm All Contingencies

When you create your SOR, take your time. Brainstorm everything that all of the interested parties would expect to receive from someone in your field, including how you intend to comply with applicable laws, regulations and customs. Spend time with your client, preferably face to face, so that both of you have a full assurance that neither party has misunderstood anything.

Any failure to establish how the client, customer or any other stakeholders view a project and to enumerate every deliverable they expect to receive may lead to more than an ignominious finale. The lack of a coherent, thorough statement of work can bankrupt your business and leave your reputation irreparably shredded.

Why Include Your SOR in Project Queries?

Project queries consist of two main types: solicited and unsolicited. Solicited project queries include answers to calls for bids and requests for information. To win their business, the statement of requirements for a solicited project query must answer all of the points raised by the entity seeking your submissions.

Unsolicited queries, on the other hand, must whet the appetite of the entity you have decided to approach. Therefore, the winning focus must include potential returns on any investments and what probable solutions your company can deliver quicker or more effectively than your competitors. Create a compelling offer with a clear call to action to win contracts using unsolicited queries.

Understand the Vital Elements

Begin your SOR with a needs assessment. Despite the fact that the client may have already provided their own needs assessment, the possibility exists that something vital to the project's success might not have occurred to the person who performed it. Review every line of the assessment provided by the client, asking probing questions to ensure that both you and the client have the same understanding of every term and condition.

Use SMART Terms

Help the client sharpen all statements of the desired outcome using SMART terms. If the client wishes to scale their business, rewrite that outcome using Specific, Measurable, Achievable, Relevant and Timely terms.

For example, instead of "Client X wishes to expand into new markets," write "Client X wishes to expand into the market for Widget Z by opening one new store per year in Tokyo, Beijing and Mumbai between 2020 and 2022."

Identify and Strategize

While it may seem obvious at the first meeting, you must identify and list in writing all parties with an interest in the contract beyond yourself and the client. These potential stakeholders may include community members, immediate neighbors of the proposed project, planning commissions, zoning officials, owners/operators of existing businesses and local wildlife, watersheds, police, fire and emergency services.

Include a discussion of several proactive strategies to reduce any possible adverse impacts on the neighborhood, your community and the region.

Provide a Statement of Work

Identify all the deliverables and the responsibilities of the client and the contractor. State in plain language, without trade jargon or legalese how and when to expect invoices, purchase materials and release funds at each stage of the operation. Each requirement should contain a single thought. The statement of work must also include the timeline for completion and who will verify that the work adhered to applicable laws, regulations and codes.

As an example for a content writer, the SOW could consist of an agreement to provide three articles per week with a three-day turnaround between proposing a title and submitting the finished work. Alternatively, a software developer might agree to create a prototype of an application. A notary might meet at a client's home or place of business to get signatures and initials so that lien notices, zoning variances or environmental impact reports meet filing deadlines.

Protect yourself from lawsuits due to unforeseen circumstances by including an exceptions and omissions statement at the end of your statement of work and by obtaining exceptions and omissions insurance.

When Does the Statement of Work Become a Legal Contract?

Both your statement of work and your statement of requirements become legal and enforceable contracts once you and your client sign, date and initial the contract in all the correct places. If your local or state Clerk of Courts requires you to file copies of all documents, the date you submit them and the time and manner in which you distribute copies to all affected parties may affect the enforceability.

What Is a "Will Say" Statement?

While few people enjoy being dragged into court, breaches of contract, conflicts of interest and simple human error can still lead to lawsuits. Being able to marshall the correct argument has won many cases. Whether a party to the lawsuit intends to testify in person or submit a deposition, most cases begin with a "will say" statement.

A "will say" statement lays out the sequence of events that lead to the dispute and often displays the strategies the prosecutor and the defense attorney intend to use to win your case. The "will say" statement sometimes serves as a deposition in place of face-to-face testimony. Point by point, the statement lays out the events as seen and experienced by the witness.

Where Might You Find A "Will Say" Statement Example?

"Will say" statement examples abound. You can pore over federal court records yourself or use a service such as the Lex Machina database instead. You may even choose to do a little research at the Library of Congress.

Where Can You Find a Sample Requirement Format?

Johns Hopkins University, QRA Corporation and Lex Machina all have a sample requirement format. Use them when you want your documents to follow best practices in project-document writing. Alternatively, many business insurers also supply templates you can use. Write your own documents rather than cutting and pasting from someone else, however, in order to maintain your client's confidence in your expertise.

Suggestions for Evaluating Requirements Examples

Use a quality checklist when writing and evaluating requirements examples. Use the word "shall" for requirements, "will" for actions that the contractor or client might need to take and use the word "should" for goals.

For example, when referencing a local building code, one statement of work might read: "Contractor Q shall follow municipal code 5.47.316, which requires that all corners of new roofs must have hurricane straps driven into the ground to a depth of 3 feet or more."

Use project-unique identifiers in any statement of work or statement of requirements. When someone cites the state or municipal code, for example, these section- and paragraph-specific references allow both the client and the contractor to easily locate essential information.

Finding Common Ground

Most well-written legal briefs, which includes "will say" statements, open with a section defining each term used in the document. This section ensures that all parties share a common vocabulary when discussing contract disputes. Once they are agreed upon, these definitions of the words and abbreviations used throughout the document make it easier to read and to write and cite.

Performing Risk Assessment

Responsible proposals include a section on the risks that the client and the contractor may face that might affect the ability to complete the project. Contractors may face serious injury or death while working on projects in areas of civil unrest. Projects located in areas prone to hurricanes or tornadoes may face delays, loss of equipment or inability to complete tasks due to foul weather.

In addition to losses from severe weather, residents may protest against encroachment by oil pipelines, highways, nuclear waste storage, garbage dumps and incinerators near waterways and residential areas. Some protestors may resort to vandalism or sabotage to halt construction. Litigation can shackle a project for decades, bankrupting a company even if it ultimately prevails in court. Full disclosure of such risks immunizes you and the client from some potential liability.

Excluded Project Goals

One often-forgotten section of the statement of work covers what the team decided not to include as a project goal. These exclusions bear as much importance as the agreed-upon terms of the contract. The goals that you and the client left out on purpose cannot creep back into the project later and wreck the schedule of payments and deliverables.

References

About the Author

After earning a B.S. Ed. from Kent State University in 1995, Smith provided educational support in multiple Ohio school districts. Smith has managed nine employees and 86 independent adult care providers at a time. In addition, Smith has assisted two charities with successful 501 (C) 3 applications, serving on the board of one for three years. Currently, Smith serves as an independent Avon representative at Avon Beauty by Laura. Her writing chops include one published novel and close to 1500 articles in various online and offline publications.